"In the wake of that, money from campaign contributors has been flowing into the coffers of the Democrats who oppose the bill while death threats have been falling upon Republicans who supported it [the bill]."

The bill's signing is a key victory for Republicans who have targeted unions in nationwide efforts to slash government spending.

Walker belongs to the new, highly conservative wave of Republican governors who have attempted to impose restrictions on public employee unions.

But labour leaders said they plan to use the setback to fire up their members nationwide and mount a major counterattack against Republicans at the ballot box in 2012.

The measure passed the state's Assembly on Thursday following more than three weeks of protests that drew tens of thousands of people to the Capitol in opposition.

Pro-union protesters planned another mass rally at the Capitol on Saturday and are circulating petitions to recall from office eight of the Republican state senators who supported the bill.